By Carole Hawkins, Staff Writer
Like industrial property, Jacksonville has shown little appetite for new office construction post-recession. But employment gains are now filling office buildings in every market, said Tarik Bateh, vice president of Capital Markets for JLL, a real estate investment firm.
“Today, we have more leased and occupied office space than we’ve ever had in the history of Jacksonville (at more than 54 million square feet),” he said. “We’re seeing businesses starting to spend more money on capital investment and more money on people. It’s not accelerating quite like we’d all like to see it, but it’s happening.”
Jacksonville finished 2013 with an unemployment rate of 5.6 percent, its lowest level since before the recession. A large chunk of the city’s job growth has been in the financial services sector, which is arguably Jacksonville’s biggest office using industry, Bateh said.
Vacancies for office buildings have fallen steadily from an average regional peak of 16 percent in 2009 to 12.7 percent in 2013, according to CoStar statistics, and rents have finally showed slight improvement, ending up 50 cents in 2013, at $17.39 per square foot.
Downtown and the Southside dominate Jacksonville’s office building landscape, Bateh said. The growth in occupancy has cut across both neighborhoods, as well as across every class of building.
“Class A (newer buildings) by and large are performing well, both Downtown and in the suburbs,” Bateh said, “but we’re also seeing increasing occupancy in Class B (older) buildings. I think Downtown will continue to strengthen and I think we’re going to see growth in rents.”